19 a. Monetary Policy
According to the classical monetary theory, inflation occurs because the addition of the money supply. Thus, theoretically relatively easy
to cope with inflation, by controlling the money supply itself. Monetary policy is the action taken by Bank Indonesia to reduce or
increase the amount of money in circulation. When the money supply too much so that inflation rose sharply, Bank Indonesia will soon
implement monetary policies to reduce the circulation of money. b. Fiscal Policy
How can fiscal policy to control inflation? As you know, fiscal policy is a policy relating to government revenue and expenditure. The
governments fiscal policy to reduce inflation is to reduce government spending; raising tax rates and holds government loans.
c. Non-Monetary Policy and Fiscal Non- In addition to monetary policy and fiscal policy, the government
policy of non-monetary non-fiscal with three ways of raising production, stabilize wages salaries, and security prices, as well as
the distribution of goods.
E. PREVIOUS RESEARCH
Previous studies that have relevance or similarity with the research undertaken today can be described as follows:
20
Table 2.1 Previous Research
Researcher Title
Method Results
Saleem and
Rehman 2011 Impacts of liquidity
ratios on
profitability Case of
oil and
gas companies
of Pakistan
Multiple Linear Regression
The liquidity ratio effect on profitability
ratio on oil and gas companies. From the
results of the study explained that it is
the ratio of liquidity or liquidity ratio has
a significant effect on the profitability
ratio.
Yanuardi, Alindra 2011
Effect of Liquidity Ratio,
Solvency Ratio
to Profitability Ratios
Banking and
Credits Agencies
Other Than Bank, Securities
Listing on
the Stock
Multiple Linear Regression
From the results of the study explained
that indeed
the solvency
ratio to
affect profitability
ratio
21 Exchange
Before and
After the
Global Crisis 2008
Kabajeh et
al 2012
The Relationship
between the ROA, ROE
and ROI
Ratios with
Jordanian Insurance Public Companies
Market Share Prices Multiple Linear
Regression There was indeed a
strong connection or relationship between
the activity ratios with a profitability
ratio; however, it was found that there
is no
significant effect between the
two.
Fengju et al 2013 The relationship
between financial
leverage and
profitability with an emphasis on income
smoothing in Iran’s capital market
Multiple Linear Regression
Exchange which
have a lower debt ratio more involved
in profitability ratio.
Heikal et al 2014 Influence Analysis
of Return on Assets Multiple Linear
Regression The findings of this
research identified
22 ROA, Return on
Equity ROE, Net Profit
Margin NPM, Debt To
Equity Ratio
DER, and current ratio CR, Against
Corporate Profit
Growth In
Automotive In
Indonesia Stock
Exchange that simultaneously
independent variables Return On
Asset, Return On Equity, Net Profit
Margin, To Equity Ratio and Current
Ratio with F test, effected together to
growth income
significantly 0.000
Source: Previous Research
23
F. RESEARCH FRAMEWORK
